As with any purchase you make, the homework you do will pay off in the long run. May I say, and experienced agent will help guide you through any process and give opinions that you then will help with the ultimate decision. For many, this is the largest dollar outlay they will ever make, so I am adamant regarding knowing every detail about the house, especially bank owned/foreclosure/short sales. If my questions are not properly answered, red flags start popping.
SInce a foreclosed home is likely vacant for some period of time, the bank is not required to do a Seller's Property Disclosure. However, even with that, a thorough home inspection is essential. Mold and Radon can be mitigate and other issues may be addressed by the seller, or not...if you know about these things in advance of closing. I agree with previous answers in that foreclosures are not always the bargains that they seem. It goes back to the old saying,"buyer beware!" Do your homework, and work with a good agent!

Best of luck on your home hunt Merideth!

Regards,

ROSEANN BLACHER
"Your Full Service Real Estate Professional"
404.376.3696-Anytime
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Roseann@RoseannBlacher.com http://www.RoseannBlacher.com
Maximum One Realty Greater Atlanta

please consider your impact before you print this email
"To whom much is given, much is expected"

I have represented various banks, government agencies, PMI and financial lenders for decades and have never had one ask to cover up anything. Just the reverse, if they have reports or inspections, they normally provide them, post them on their websites, and require for a reciept for such reports in any offer. These homes are sold as is, without a seller disclosure, but they do provide a 7-10 day due delegence periods plus the Lead Based Paint Requirements for inspections on all sales, as stipulated by law. Inspections ordered must be provided, even on as is sales with non-disclosure, as these are a material fact. It does no one any good to get something under contract and then have it fall through during inspection/due deligence on something you know about it the first place. Most banks and government agencies have consumer hotlines to report incedents of fraud, etc. on their properties to stop exactly these type things from happening. They have cross checks for all phases and all vendors associated with their properties, whether yard maintenace or listing agents.

Is the home located in Morningside? I think I viewed the same home.

It is unfortunate what might happen with REO properties. I do have a question though for the RE Agents/Brokers. Please correct me if I am wrong in any expectations or concepts of how REO's are handled.

Most REO's are handled by Brokerages after the bank performs foreclosure. Many Brokerages also handle the functions of board-up, clean-out, etc. through a third party company. It is also understood that the "Bank" is basically the client of the REO Brokerage. However, even though the bank is not required to disclose, would this not be under the required Georgia State, National Association Of Realtors, or GAR "Ethics" for a REO Agent/Broker to disclose significant rehab and mold remediation was performed only on visible areas of mold?

Emmanuel J. Scanlan
PS Inspection & Property Services LLC http://www.psinspection.com
214-418-4366 (cell)
TREC License # 7593
International Code Council, Residential Combination Inspector #5247015-R5 (Electrical, Mechanical, Plumbing and Building)
Certified Infrared Thermographer (ASNT-TC1A Standards)
Texas Residential Construction Commission, Third Party Warranty Inspector #1593
Texas Residential Construction Commission, Inspector, County Inspection Program
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CMC Energy - Certified Energy Auditor

Knowledge is power, but sharing knowledge brings peace!!

I understand how you feel about the bank, but the reality is it will cost you a lot of money to do anything about it, and even if you were able to cause them any pain, it wouldn't change their ethics. Now that you know how that seller operates, maybe the thing to do is not consider their properties for purchase.

As Howard said, these properties are simply being liquidated by the banks/lenders/disposition companies and in most cases there is no first hand knowledge of condition. That said, there is a process they go through that includes appraisals, clean outs, agent price opinions, listing process and regular maintenance so obvious issues should be handled....unless of course the seller is just selling totally "as is". Buyer's are also given a due diligence period and are expected to check any/all things that are important to them. But if you think the seller cares much about the home, think again.

Now, in this case if the contractor made them aware of an issue and the owner did what the contractor said, then there might be an issue. That said, there's probably not anyway to know for sure, let alone proving that in court. It's not surprising to me, what goes on with distressed properties is amazing. The sellers just want them gone.

I'll sum it up this way - I do a significant amount of work on the appraisal side of these homes, dealing with them is often miserable. The things some people do to homes when they leave is disgusting and mold like you saw isn't unusual - people induce it by flooding homes. There are many other disgusting and reprehensible things I've seen...more than once that buyers are not likely to catch up with until after closing when they start living in them.

Foreclosures aren't the bargain everyone thinks they are for a number of reasons. Ever have a kid play with your computer? In a few key strokes they can totally jam things up and cost you hours and hours of trying to figure out what was done - foreclosures can be the same way....if you even get it at a competitive price. Everyone is convinced they're the deal of the century - I don't see it that way.

Hope this helps -

Hank Miller, SRA, ABR
Associate Broker & Certified Appraiser
Prudential GA Realty
678-428-8276

Merideth:

On most foreclosures, banks have no representation as to the condition of the home that are being sold as a foreclosure. Why is this..... They have never stepped foot into the house and only represent the the house in a financial situation, that's there only concern. Now, in this case, it sounds like the bank was made aware of potential heath risks with the home, if this can be proved that they did know, then a buyer may have grounds to persue legal actions.

It would not hurt to seek legal counsel, there you will find your best answer.

Regardless of the sellers position on the house, as a Realtor, I would always recommend to my buyers to have the home inpspected and would negotiate into the contract the inspection contigency.

I hope this helps.....

Your Real Estate Professiona

Howard Rose III, Army (Ret) Realtor
Keller Williams Realty
4400A St. Andrews Rd.
Columbia, SC 29210
803-800-4448
hrose@kw.com